.Jesusegun Alagbe and Tobi Aworinde
After the Central Bank of Nigeria ordered banks and other financial institutions to close all accounts that operate cryptocurrency exchanges on Friday, some experts in cryptocurrency trading have raised alarms about their economic impact.
Sterling Bank’s Blockchain Solutions Architect Charles OkaforMbah noted in an interview with Sunday PUNCH that crypto trading is divided into formal and informal exchanges.
“There is the formal exchange like Binance which is the most popular. and Patricia. We have some other players like BuyCoins and Bundle Africa. If we put the numbers of these traders together, we could see a huge amount each week.
“There are also informal markets. We call them over-the-counter traders. This is where the peer-to-peer traders are located, and most of these people use private chat rooms like WhatsApp and Telegram or some other cheap platform. The volumes there have not yet been calculated. So when you add in the volumes that people make in trading rooms, the numbers tend to go up too.
“With such a policy, many companies are killed by being evicted. When the government tries to prevent people from trading crypto by blocking the accounts of these exchanges that people pay money to and then withdrawing their money from those accounts, many players will be banned from participating in the crypto space. “
While speaking about job creation through crypto trading, OkaforMbah said, “My mother is 65 years old and trades in crypto. So it’s not just the young people who are affected. It also affects the older generation. “
He noted that crypto exchanges employed blockchain developers – some of the highest paid programmers said, “As of 2020, blockchain developers will be in high demand around the world.”
Blockchain is a type of diary or spreadsheet that contains information about transactions, while blockchain developers enable secure digital transactions by creating systems to record and store blockchain data in a way that prevents changes or hacks.
OkaforMbah explained that the local exchanges also employed smart contract workers, marketers and customer service agents, and rented office space. He added that while CBN policies created a ripple effect, he was optimistic that trade would rebound.
The crypto expert said, “Most users now receive emails from exchanges that withdrawals and deposits are no longer taking place. But definitely there will be a way out, but it will take people some time to adapt and this is where P2P trading comes in. This is how crypto trading began.
“China and India tried something like this, but it didn’t work. Visa is working with Anchorage on something to enable banks to trade and buy bitcoins for their customers. If developed countries are grappling with blockchain and crypto laws, why should the government in Nigeria thwart the efforts of citizens trying to make a living for themselves? “
Similarly, Cowry Asset Management Limited founder and chief executive Johnson Chukwu told Sunday PUNCH that CBN policies would affect cryptocurrency trading in the country and leave some citizens unemployed.
“I saw a couple of young Nigerians making decent incomes trading cryptocurrencies. Remember, Nigeria is largely a youth country and we have a lot of educated people who may not be fully employed.
“Because of this, many of them are into cryptocurrency trading and they understand it. In fact, we can cut off their source of income and financial commitment. There will be some impact on the income of cryptocurrency investors, ”he said.
Chukwu said, despite Apex Bank’s concerns about cryptos, that they could be used to fund illegal transactions such as terrorism and that there was no need to close investors’ accounts.
“There could only have been warnings so as not to completely exclude investors from the financial system. The CBN should find a way to use the positive side of new knowledge to move society forward, ”he said.
Chukwu said it is now time for financial regulators to develop methods to either regulate cryptocurrencies or incorporate them into the financial system, saying the technology will not go away.
“As soon as there is an advance in knowledge, it cannot be reversed. My point of view is that the regulator ultimately has to find ways to regulate the operation of cryptocurrencies because as long as knowledge has evolved, it won’t go away. Tight regulation can only bring it to the parallel or black market, ”he said.
Meanwhile, the Chief Executive Officer of Economic Associates, Mr. Ayo Teriba, said the CBN could not ban trading in cryptocurrencies, just as the CBN could not prevent people from gambling.
“However, the CBN can prevent banks and financial institutions it has licensed from engaging in activities such as gambling.
“So the CBN is not saying that people cannot trade cryptocurrencies. It only restricts financial institutions because it has a responsibility to manage systemic risk in the country. As a country’s risk manager, it will be risk averse [to cryptocurrency trading],” he said.
Atiku, Ezekwesili tackle CBN
Meanwhile, a cross-section of prominent Nigerians used social media to express their opposition to Apex Bank’s policies.
Former Vice President Atiku Abubakar criticized CBN policies in a statement on Twitter on Saturday entitled “We have to open our economy, not close it”.
In part it said: “What Nigeria needs now, perhaps more than ever, is jobs and an opening up of our economy, especially after yesterday’s report by the National Bureau of Statistics showed that the inflow of foreign capital into Nigeria is at a four-year low. dropped from $ 23.9 billion in 2019 to just $ 9.68 billion in 2020.
“The nation has already suffered severe economic losses from the border closure and the effects of the COVID-19 pandemic. This is definitely the wrong time to introduce policies restricting capital inflows into Nigeria and I urge that the policies banning the trading and transaction of cryptocurrencies be revised. “
With this in mind, the former Minister of Education, Dr. Oby Ezekwesili: “Honestly, @cenbank, all you had to do was map out any legitimate risks related to #cryptocurrency and gather a subset of the super brilliant Nigerian young minds in #. FinTech so you can listen and learn more. Learning is the policymaker’s greatest asset. Never too late.”
Crypto ban won’t deter us, Nigerian traders insist
Despite the politics, some Nigerians stayed defiant on Twitter, saying they weren’t put off by CBN politics.
In response to the ban, Abdulhameed Abu said, “The simple truth is that there is nothing @cenbank can do to enforce this ban. The very definition of a decentralized system is the lack of concentrated control. If I were you, I would be proactive in looking for ways to regulate and tax such a potentially large source of income.
“Countries like America and the others recognized this earlier. Since then, they have found interesting ways to regulate and generate revenue from the cryptocurrency sector. Meet with key industry players and come up with good laws to govern this and forget about the ban. “
Emmy Jesus said, “It’s very simple: trade with Ghanaian or Togolese banks, open an international account and forget about Nigerian banks with the CBN policy.”
@CDiepreye said, “Nothing done by @NigeriaGov can stop me from trading with @binance and others. After all, I make money abroad and bring it home (Nigerian economy). “
@sirpeeworld said: “Nobody should panic just yet. Many ways will soon be discovered. When you have someone outside of Nigeria, getting your Bitcoin things done is easy for you. You can transfer to anyone outside of Nigeria. They will buy from you and send you naira. “
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